eToro Reminds Its Australian Clients of New Rules for CFD Trading

Fazzaco learned that eToro, an Israeli social trading and multi-asset brokerage company, is reminding its Australian clients regarding new rules for CFD trading that will come into effect from 29th March 2021.

As Fazzaco has reported, the Australian Securities and Investments Commission (ASIC) has released its Product Intervention Order - Contracts For Difference Instrument 2020/986 which will affect retail clients that trade any CFD products. 

The new ASIC regulatory changes are listed below and provided by eToro AUS to its retail clients:

Leverage restrictions

• 30:1 on major currency pairs

• 20:1 on minor currency pairs, gold and major stock market indices

• 10:1 on commodities other than gold, and minor stock market indices

• 2:1 on crypto-assets

• 5:1 on shares or other assets

Margin close-out protection

If the total equity in your account falls below 50% of the margin required for all your open CFD positions, one or more of your CFD positions will be automatically closed out as soon as market conditions allow. eToro AUS already provides this protection to all retail clients.

Negative balance protection

Prevents losses from exceeding the funds present in a client's account when a trade is closed. eToro AUS already provides this protection to all retail clients.

Prohibition of promotional offers

Certain benefits such as volume rebates and rewards, incentives or gifts cannot be given or offered to retail clients as they could be considered to be an inducement to open, acquire or fund a CFD account or trade CFDs.